TMI Blog1995 (7) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... ven or hot plate. The stretched tapes are of 2.5 mm to 3 mm in width. These tapes are wound into cheese widers for warp and weft. The cheese pipes are sent to looms for weaving where the weft bobbin are fixed on shuttles and warp bobbin are mounted on cred and then woven into fabric on looms. Thus the plain fabric is obtained. This fabric is mainly used is the preparation of bags, cushions, covers, curtains etc. 3. The fabric manufactured by the petitioners is stated to be used in the making of sacks and bags etc. It is contended that in exercise of the powers conferred by Section 4 (a) of the U. P. Sales Tax Act, a Notification No. 4064, dated 25th November, 1958 was issued by which exemption was granted unconditionally in respect of sales of Sugar, cigars, cigarettes and taxtiles. Under the said notification rayon or artificial silk fabrics are specifically exempted from sales tax. In the petitioners' own case reported in Commissioner of Sales Tax v. M/s. Kanpur Plastic Pack (P) Ltd , 1984 UPTC 641, a learned Single Judge of this Court held that the H. D. P. E. fabric manufactured from tapes comes within the scope 'Rayon or artificial silk fabric'. Subsequent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Government whether or not to levy taxon a particular commodity. It is contended that there is no reason whatsoever for giving a different treatment to the manufacture of H D P. E. fabrics from the treatment, it is being given to the general class of the manufacturers of rayon an artificial silk fabrics. 4. In the counter affidavit filed on behalf of the respondents, it has been contended that it is in the discretion of the Government to levy or not to levy tax on any particular commodity. According to them the State is competent to levy sales tax on any commodity. It is permissible to the State to pick and choose the persons, commodities and the rate of tax and the State Government in its wisdom opted not to grant exemption of H. D. P. E. and P. V. C. fabrics. 5. We have heard the learned Counsel for the petitioners Sri Bharat Ji Agarwal and the learned Standing Counsel Sri H. R. Mishra. 6. In the Notification No. ST-2-7038/X-7 (23)/83-UP Act XV-48-Order-85 dated 31-1-1985 by which exemption has been granted in respect of a large variety of goods, Entry 53 deals with textiles and reads as under : 53. Textiles of the following varieties manufactured on powerloo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers made out of fabrics of any of the varieties mentioned in sub-clauses (a), (b) or (c) above, (ii) cotton velvets and velveteen but excluding embroidered velvets ; (iii) hosiery cloth in length ; (iv) book-binding cotton fabrics and leather cloth and inferior or imitation leather cloth ordinarily used in book binding ; (v) bandages ; (vi) rubberised or synthetic water proof fabrics, whether single-textured or double textured. 8. The learned Counsel for the petitioner referred to rayon or artificial silk fabrics, including staple fibre fabrics of all varieties mentioned in clause (b) of the annexure in the above entries and emphasised that by this clause all rayon and artificial silk fabrics of all varieties have been granted exemption from sales tax. Placing reliance on the judgment of this Court in C. S. T. v. Kanpur Plastic Pack (P) Ltd., 1984 UPTC :41 in which Court held that H. D. P. E. fabrics are artificial silk fabrics, he contended that when clause (b) of the annexure aforesaid exempts rayon and artificial silk fabrics of all kinds, there is no justification for excluding H. D. P. E. fabrics. He placed reliance on Ayurveda Pharmacy v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well settled that though taxing laws are not outside Article 14, however, having regard to the wide variety of diverse economic criteria that go into formulation of a fiscal-policy legislature enjoys a wide latitude in the matter of selection of persons, matter, events, etc., for taxation. The tests of the vice of discrimination in a taxing law are, accordingly, less regorous. In examining the allegations of a hostile, discriminatory treatment what is looked into is not its phraseology, but the real effect of its provisions. A legislature does not, as an old saying goes, have to tax everything in order to be able to tax something. If there is equality and uniformity within each group, the law would not be discriminatory. Decisions of this Court on the matter have permitted the legislatures to exercise an extremely wide discretion in classifying items for tax purposes, so long as it refrains from clear and hostile discrimination against particular persons or classes. But, with all this latitude certain irreducible desiderata of equality shall govern classifications for differential treatment in taxation laws as well. The classification must be rational and based on some qualit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich fabrics may be made. There are other raw materials for making fabrics e. g. cotton, silk, nylon, rayon hessian and jute. Thus, H. D. P. E. fabrics are a class by themselves because of the raw material of which they are made. Then the entry 53 as reproduced above indicates that the exemption is in respect of taxtiles and fabrics manufactured on powerlooms that are usually used for human clothing, linen, etc. H. D. P. E. fabrics, according to the petitioners' own case, are not used for human clothing and is used only as a packing material and for the manufacture of sacks, bags, bail covers, etc. (see paras 7 and 22) Therefore, granting exemption to fabrics used mainly for human clothing, a basic necessity, to help the common man by avoiding to escalate their prices, and denying the same to a fabric that is not so used cannot amount to hostile or unreasonable discrimination. The entry further shows that the Government has excluded from exemption other fabrics also that are mainly used for packing of goods e. g. hessian and jute cloth as well as P. V. C. fabrics. Even ray on and nylon tyre cord fabrics have been excluded. The list of exclusions includes other fabrics like durri ..... 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